Holiday of Glendale Investment

INVESTMENT OVERVIEW
On June 1, 2017, the fund invested in a build-to-suit development of a senior housing facility that is leased to the largest independent living operator in the United States, Holiday Retirement. The executed lease will commence rent payments when construction is complete in March 2018 (forecasted). The lease was structured with a corporate rent guarantee, triple net expense basis and annual escalations based on CPI with a 2.50% minimum.

 

PROPERTY DESCRIPTION

  • $23 million total project cost
  • 129-unit independent living facility
  • 112,509 square feet
  • 3-Story Building
  • 8.3 acres

 

ABOUT THE TENANT: HOLIDAY RETIREMENT

  • Largest independent living operator in the United States
  • Operates over 300 senior housing facilities
  • Founded in 1971
  • Highly desirable tenant for institutional buyers

 

LEASE CHARACTERISTICS

  • Single tenant, 100% leased
  • 15-year lease term
  • Corporate rent guarantee
  • Annual rent escalations

 

PROJECT LEVEL RETURN

  • Estimated total return of 73%
  • Estimated Internal Rate of Return (IRR) of 15%
  • Expected sale to occur in 2020
  • Designed to allow for easy expansion and potential for increased return

 

LOCATION

  • 1 mile from AZ 101 Freeway
  • 1.5 miles from Dignity Hospital
  • 1 mile from Westgate (large retail center, adjacent to Arizona Cardinal Stadium)
  • Internal and external market demand studies indicate significant demand and low supply for independent living units

For more information , read our case study here.